Still A lot of questions to be answered by managementWho did we sell egress to? Who is the seven year marketing agreement with?who is the assignment agreement with? We need answers to these questions.
Commercial Transactions Overview Athabasca has assigned its Keystone Base service of approximately 7,200 bbl/d of blended bitumen capacity and the Development Cost Agreement (“DCA”) in relation to the Keystone XL pipeline to an industry player. The Company has also entered into a seven-year marketing agreement with the counterparty for 15,000 bbl/d of heavy oil that will diversify the Company’s sales to the US Gulf Coast once the incremental Keystone Base service becomes available to industry. The marketing agreement has customary and additional fees including a flow through pipeline tariff when the Gulf Coast service becomes available. This transaction increases corporate liquidity by approximately $80 million through the recovery of a deposit and the release of restricted cash that was securing existing letters of credit.29dk2902l29dk2902l
Additionally, the Company has executed a sale and assignment agreement of its 20,000 bbl/d TMX pipeline service to a downstream player for $20 million cash consideration. Athabasca believes that the timing for monetizing the service is optimal as the Company receives cash consideration today while still being able to participate in the benefits of the construction of the pipeline through an improved local basin differential outlook. The transaction reduces $1.1 billion of transportation commitments over the 20-year term and removes a $50 million future financial assurance requirement once the pipeline is operational.